Don't Ignore The Fact That This Insider Just Sold Some Shares In Shaw Communications Inc. (TSE:SJR.B)

We wouldn't blame Shaw Communications Inc. (TSE:SJR.B) shareholders if they were a little worried about the fact that Willard Yuill, the Independent Director recently netted about CA$2.4m selling shares at an average price of CA$24.62. However, it's crucial to note that they remain very much invested in the stock and that sale only reduced their holding by 4.3%.

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The Last 12 Months Of Insider Transactions At Shaw Communications

In fact, the recent sale by Independent Director Willard Yuill was not their only sale of Shaw Communications shares this year. They previously made an even bigger sale of -CA$9.1m worth of shares at a price of CA$22.85 per share. That means that an insider was selling shares at slightly below the current price (CA$24.73). As a general rule we consider it to be discouraging when insiders are selling below the current price, because it suggests they were happy with a lower valuation. However, while insider selling is sometimes discouraging, it's only a weak signal. This single sale was just 12% of Willard Yuill's stake.

In total, Shaw Communications insiders sold more than they bought over the last year. The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!

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Does Shaw Communications Boast High Insider Ownership?

For a common shareholder, it is worth checking how many shares are held by company insiders. We usually like to see fairly high levels of insider ownership. Shaw Communications insiders own 4.1% of the company, currently worth about CA$523m based on the recent share price. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

So What Do The Shaw Communications Insider Transactions Indicate?

An insider sold stock recently, but they haven't been buying. Zooming out, the longer term picture doesn't give us much comfort. While insiders do own a lot of shares in the company (which is good), our analysis of their transactions doesn't make us feel confident about the company. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Shaw Communications. For example - Shaw Communications has 3 warning signs we think you should be aware of.

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For the purposes of this article, insiders are those individuals who report their transactions to the relevant regulatory body. We currently account for open market transactions and private dispositions, but not derivative transactions.

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This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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